Naomi sells her car to Jack, who assumes her mortgage. Naomi, in other words, has delegated the duty to pay the bank to Jack. This contract is called:

Question

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The given scenario is an example of novation, which refers to the substitution of a new contract or obligation for an existing one. Naomi has transferred her obligation to pay the mortgage to Jack, who has assumed the responsibility. This creates a new agreement between Jack and the bank, releasing Naomi from her duty to pay.

Naomi Sells Her Car to Jack, Who Assumes Her Mortgage